Pinning down the knowledge economy

Jul 31 2006 by Brian Amble Print This Article

The debate about the 'knowledge economy' is full of slovenly thinking and careless assumptions, a new report by UK think-tank The Work Foundation has alleged.

"Defining the Knowledge Economy", the first paper in The Work Foundation's three-year investigation into the phenomenon of the knowledge economy, argues that despite the fact that the concept of the knowledge economy has been around for half a century, no real definition of what it actually is has so far emerged.

"In broad terms, we know that the knowledge economy is what you get when organisations bring together powerful computers and well-educated minds to create wealth," said Ian Brinkley, the paper's author and programme director.

"And we also know that this combination is a new thing in the history of the world: firms in the knowledge economy compete on their ability to exploit scientific, technical and creative knowledge bases and networks."

The difficulty, he argues, is coming up with a measurable definition that allows the hype to be tested against hard facts.

"Around the world, governments talk about the future belonging to 'knowledge-based industries' and 'knowledge workers' without bothering to question which firms and individuals are in and which are out of these categories."

Citing the example of the UK, Brinkley points out that all those in managerial, professional and associate professional jobs have been categorised as knowledge workers

But included in this group are managers of shops, garages, farms, funeral parlours and warehouses Ė not knowledge workers at all. In fact, he argues, almost a quarter of all managers are not knowledge workers at all and should not be included in the figures.

Remove these and the knowledge workforce in the UK suddenly looks smaller than previously claimed, with fewer than four out of 10 (38 per cent, or 11.1 million workers) realistically able to be viewed as knowledge workers.

It is a similar story with knowledge-based industries, defined by the OECD as high to medium tech manufacturing such as pharmaceuticals, aerospace and electrical engineering, financial and business services, telecommunications; and education and health.

But shouldn't the creative industries - film and television production, advertising and marketing - be included as knowledge industries, Brinkley asks. And isn't there a case for including some public administration roles?

"These questions can, at first, seem petty and technocratic," Brinkley admits. "But behind them lies a momentous question. If, as virtually every serious economic commentator believes, the productivity of knowledge-based work is critically important to our future, then it is essential to try and measure knowledge accurately and logically.

"The slovenly thinking about what constitutes 'knowledge work' needs to be challenged," he added.